Unfair Spanish tax system for self employed
Oct 19th 2011, 10:16 am
#16
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Re: Unfair Spanish tax system for self employed
I guess it is a very crowded boat and I don't even want a sodding Spanish pension. The worst thing I ever did was start a business in Spain and get an NIE after many happy years holidaying here. I do not see any value for money for the 400 euros approx/month I pay into their system
To anyone considering a move to Spain, a lesson. Don't get an NIE unless you want a job, especially if you live in an touristy area where you can blend in with holiday makers. There is no benefit to being legal here if you are self employed. Open a bank account before you arrive in Spain as a UK resident with your passport which should be all you need to pay bills and open utility accounts (ignore any declarations they may send you and never put so much in there that you have to worry about any deductions they make for withholding tax) . If you are on the costa del sol join helicopteros sanitarios which will give you access to a GP and back it up with a private health plan (the combined cost should be approximately 1/4 of the cost of Social security + fees.
Of course if you have children etc this gets a little more tricky but I would not hesitate giving this advice to anyone considering a move to Spain
To anyone considering a move to Spain, a lesson. Don't get an NIE unless you want a job, especially if you live in an touristy area where you can blend in with holiday makers. There is no benefit to being legal here if you are self employed. Open a bank account before you arrive in Spain as a UK resident with your passport which should be all you need to pay bills and open utility accounts (ignore any declarations they may send you and never put so much in there that you have to worry about any deductions they make for withholding tax) . If you are on the costa del sol join helicopteros sanitarios which will give you access to a GP and back it up with a private health plan (the combined cost should be approximately 1/4 of the cost of Social security + fees.
Of course if you have children etc this gets a little more tricky but I would not hesitate giving this advice to anyone considering a move to Spain
I understand your frustration, but I would not encourage anyone to live completely in the black economy. A terrible way to live, always looking over your shoulder and entitled to nothing
Spanish hacienda have a big campaign at the moment targetting small businesses, making sure they are uptodate with their tax and social security and not employing anyone illegally. Apparently next year they will be looking into individuals who have no or very low contributions to see how they fund their lifestyle
Oct 19th 2011, 10:19 am
#17
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Re: Unfair Spanish tax system for self employed
I wouldn't rely on this tinpot country ever paying things back. I am still waiting for a refund of IVA from last December. The only reply I ever get from my worse than useless assessor is that they are investigating it. I applied for a VAT refund for a business I closed down in the UK last year, it came 14 days later.
Civil servants around the world are notoriously lazy and incompetent...complete the job title to Spanish civil servant and you can take lazy and incompetent to a new level with a hint of added corruption
Civil servants around the world are notoriously lazy and incompetent...complete the job title to Spanish civil servant and you can take lazy and incompetent to a new level with a hint of added corruption
Plus we are set up with the "electronic firma/NIE" which means we can file our returns online and also apply for things like maternity leave etc. Its very convenient and means we dont have to spend our time in queues at the local offices
However, I do agree social security should be based on how much you earn
Oct 19th 2011, 10:24 am
#18
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Joined: Oct 2010
Posts: 46
Re: Unfair Spanish tax system for self employed
Yes i think as well that something is completly wrong as you can not ever reach 58% taxes even if you earne even more than 50 K eur a month. We are registered as autonomo and max we pay 27% only on the gain we do. Check again with your accountant as something is wrong
Oct 19th 2011, 10:35 am
#19
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Re: Unfair Spanish tax system for self employed
. The Spanish social security system is blatantly unfair for self employed people and as for the benefits cricketman talks of, I have demonstrated above that private healthcare does not even touch the cost of SS payments and self employed people as far as I can tell have no right to unemployment benefit...so what are the benefits ? the hope of a pittance of a pension you may not live long enough to see ?
Oct 19th 2011, 10:41 am
#20
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Re: Unfair Spanish tax system for self employed
Spanish have been doing it for years...... seems to work for them.
Last edited by whitelinen; Oct 19th 2011 at 11:08 am.
Oct 19th 2011, 11:05 am
#21
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Re: Unfair Spanish tax system for self employed
and let us not forget how everyone loves to harp on about immersing ourselves in the local lifestyle and getting in touch with the "culture" which surrounds us in the place we choose to reside.
If only I had an interest in Spanish culture...perhaps I would be less likely to pay these crippling taxes which benefit me in no way whatsoever
If only I had an interest in Spanish culture...perhaps I would be less likely to pay these crippling taxes which benefit me in no way whatsoever
Oct 19th 2011, 11:26 am
#24
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Re: Unfair Spanish tax system for self employed
To anyone considering a move to Spain, a lesson. Don't get an NIE unless you want a job, especially if you live in an touristy area where you can blend in with holiday makers. There is no benefit to being legal here if you are self employed. Open a bank account before you arrive in Spain as a UK resident with your passport which should be all you need to pay bills and open utility accounts (ignore any declarations they may send you and never put so much in there that you have to worry about any deductions they make for withholding tax) ..........................
Of course if you have children etc this gets a little more tricky but I would not hesitate giving this advice to anyone considering a move to Spain
Go illegal, and you'll be OK?
Oct 19th 2011, 11:45 am
#25
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Re: Unfair Spanish tax system for self employed
I have a sunny beach, an airport close by for when I need to seek civilisation, telephone line, internet access and a Morissons supermarket within 20 minutes. The place suits me just fine and if I have to pay then I have to pay, it's only money and really no more than a minor irritation.
And mitzy...I would not waste my time advising peter about anything... like Sinatra he likes to do things his way as you probably can tell
And mitzy...I would not waste my time advising peter about anything... like Sinatra he likes to do things his way as you probably can tell
Oct 19th 2011, 11:46 am
#26
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Re: Unfair Spanish tax system for self employed
Governments create black economies not people.
Oct 19th 2011, 12:02 pm
#27
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Re: Unfair Spanish tax system for self employed
It would be much better if social security was linked to income
However, it is swings and roundabouts, social security is higher, but council tax much lower than the UK and actually zero if you rent. So we save 250 euros per month by not having to pay council tax, that already covers one social security payment!
For the British people here, if their income is so low here in Spain then wouldnt they better of in another country? Especially if they dont like the culture or Spanish way of life. Scraping away just because its sunny seems terribly sad to me
Oct 19th 2011, 12:38 pm
#28
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Re: Unfair Spanish tax system for self employed
Well yes, if someone earns less than 1000 euros a month then it is dificult to do it legally, I agree, as 25% will be going straight out as social security, then plus a little bit if tax..
It would be much better if social security was linked to income
However, it is swings and roundabouts, social security is higher, but council tax much lower than the UK and actually zero if you rent. So we save 250 euros per month by not having to pay council tax, that already covers one social security payment!
For the British people here, if their income is so low here in Spain then wouldnt they better of in another country? Especially if they dont like the culture or Spanish way of life. Scraping away just because its sunny seems terribly sad to me
It would be much better if social security was linked to income
However, it is swings and roundabouts, social security is higher, but council tax much lower than the UK and actually zero if you rent. So we save 250 euros per month by not having to pay council tax, that already covers one social security payment!
For the British people here, if their income is so low here in Spain then wouldnt they better of in another country? Especially if they dont like the culture or Spanish way of life. Scraping away just because its sunny seems terribly sad to me
A far fairer system would be to do as most other countries in Europe do it with a much lower minimum payment + percentage of income. If you break down the 260 euros/month.
I would imagine somewhere in the region of 100 euros/month would represent a true cost of covering yourself for the benefits you are entitled to with the balance going into the system to cover the costs of those less fortunate than yourselves (in effect charity). These enforced donations can only be viewed as unfair without the excess income to justify them.
IMO this is just another example of Spanish short sightedness as it does nothing to attract entrepreneurs since the cost of dipping your toe in the water are huge ...not to mention that I definitely would not consider employing anyone here again, which again is another story
yes, it must be an awful place to scrape a living in cricketman
Oct 19th 2011, 12:56 pm
#29
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Re: Unfair Spanish tax system for self employed
I would imagine somewhere in the region of 100 euros/month would represent a true cost of covering yourself for the benefits you are entitled to with the balance going into the system to cover the costs of those less fortunate than yourselves (in effect charity). These enforced donations can only be viewed as unfair without the excess income to justify them.
That 260 euros has to cover the health service and pension plus rights such as maternity leave
You'll find that 260 euros doesnt even come close to the real amount needed to pay for such services. Spain spends 3,000 euros per person on health each year for a start!
Oct 19th 2011, 1:20 pm
#30
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Re: Unfair Spanish tax system for self employed
You only have to look at the number of instances that have come to light in corruption cases.